The Art Of Hosting

I must admit that ASPs as a group haven't been top of mind for me lately. But that's not because I believe their proposition has gone the way of the dinosaur. Rather, it's because the movement is now expressing itself in a different form,one that colors organizations' overall planning around their e-business operations.

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HEATHER CLANCY

Can be reached via e-mail at [email protected].

The fact is that more and more companies are willing to outsource pieces of their network infrastructure,if not the applications sitting atop it. So while they may not be subscribing to massive enterprise applications delivered in a subscription format, they are purchasing things such as core e-mail or security services in a hosted, managed form.

Last April, market-research firm IDC predicted the market for hosting,mostly the managed form as opposed to co-location in data centers or shared hosting,would grow to nearly $10.4 billion by 2007. This represents a compound annual growth rate of 15.1 percent compared with today's levels. More to the point, IDC claims more than 42 percent of midsize and large enterprises already have hosting arrangements, while more than 50 percent of small businesses turn to hosting providers. The main reason these customers turn to outsourced hosting is cost savings, according to IDC's report.

Another big factor behind this rebirth may include the fact that the carriers and other hosting service providers are in a much better state of health than just a year ago. The companies that have emerged from an unprecedented period of consolidation and bankruptcies are bigger and, in theory, more stable. Plus, in the past year, many have developed serious partner programs that combine the economics of the telco agent world with partnering practices more familiar to network VARs.

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If you've never thought about offering hosting services, now is the time to survey the landscape, if for no other reason than making the management of network infrastructure on behalf of your clients easier for your own technical staff.

What's your hosting proposition? HEATHER CLANCY, Editor at CRN, welcomes your letters and comments at [email protected].